TaxTMI 
TaxTMI 
TaxTMI 
2025 (9) TMI 674
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....tward transportation service for the period June 2009 to December 2009. After due process of law, the Ld. Original Authority confirmed the demands as regards (i) and (iii) and dropped the demand of duty in respect of (ii). Aggrieved by the said order, the appellant preferred appeal before the Ld. Commissioner (Appeals). Vide the impugned order, the Ld. Commissioner (Appeals) rejected the appeal filed by the appellant. Hence this appeal. 3. Ld. Counsel Shri R. Parthasarathy appeared for the appellant and Smt. O.M. Reena, Ld. Authorized Representative appeared for the respondent. 3.1 The Ld. Counsel for the appellant submitted that the construction of Cement Grinding Plant is essentially a "Turnkey project" and it came into existence only after completion of erection and commissioning of several integral parts of the plant. The individual machinery, equipment, parts and accessories and iron and steel raw materials loose their identity after fabrication and get integrated with the plant. The iron and steel goods were raw materials used in the construction of the Cement Grinding plant. The admissibility of CENVAT credit for the said goods as inputs needs to be decided in accordance w....
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....nts submit that the ratio laid down in the Larger Bench was followed by Hon'ble Chennai Bench in the following cases including that of the appellant. a. Inox Air products Ltd. Vs CCE, Chennai -1 [Final Order No: 40201 of 2024 dated 22.2.2024] b. Madras cements Ltd. Vs CCE, Chennai Outer Commissionerate [Final Order No: 40812 of 2024 dated 8.7.2024] He hence, prayed that the impugned order may be set aside. 3.2 Smt. O.M. Reena, Ld. AR appeared for revenue. She stated that in the case of the iron and steel raw materials used in setting up the plant they lose their identity after fabrication and get integrated with the plant. Goods after assembly and erection become fixed to earth which are immovable property and are not excisable and hence goods used in setting up the same are not eligible for input credit. In the case of GTA the factory gate represents the place of removal and outward transportation beyond the place of removal is not input service as per the definition of Rule 2(l) of the Cenvat Credit Rules, 2004. She further reiterated the points made in the findings and prayed that the appeals may be dismissed. 4. We have heard the rival parties and gone through the appeal....
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....her direct or indirect and may include or may not include their presence in the final products. Goods used in the manufacture of capital goods, which are installed for manufacture of the capital goods should also be considered for availment of CENVAT credit. In the case in hand, the cement and steel bars used to erect foundations for installing different machines in the power plant should also merit consideration as 'input' for the purpose of CENVAT benefit. Analyzing and interpreting scope of the definitions of 'input' and 'capital goods', the Hon'ble Madras High Court in the case of M/s. Thiru Arooran Sugars & Ors. (Civil Misc. Appeal Nos. 3814/2011 and 2695 and 2696/2012) has held that steel and cement used for laying of foundation for erection of capital goods should be eligible for the CENVAT benefit under the present set of rules. The relevant paragraph in the said order is extracted herein below:- "44. In the facts of this case, we have to conclude that MS structural, which support the plant and machinery, which are, in turn, used in the manufacture of sugar and molasses are an integral part of such plant and machinery. The assessee has clearly demonstrated that structural....
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....ems are not used as part of the cement plant. Instead, the Credit has been disallowed observing that these items take the nature of immovable property after being fixed to earth. The Department has placed reliance on the Larger Bench decision in the case of M/s. Vandana Global Ltd. (supra) to reach such conclusion, wherein it was held that after assembly/installation/erection, the machinery and components would result in the emergence of immovable property, which is non-excisable goods. This view was considered to be no longer good law in the decision of Mundra Ports & Special Economic Zone Ltd. (supra) as well as the decision of the Hon'ble High Court of Chhattisgarh in the case of M/s. Vandana Global Ltd. Vs. Commissioner of C.Ex. & Cus., Raipur - 2018 (16) G.S.T.L. 462 (Chhattisgarh). The Hon'ble jurisdictional High Court in the case of India Cements (supra) and Thiru Arooran Sugars (supra) has analysed the eligibility of Credit on the basis of user test laid down by the Hon'ble Supreme Court in the case of Commr. of C.Ex., Jaipur Vs. Rajasthan Spinning & Weaving Mills Ltd. - 2010 (255) E.L.T. 481 (S.C.). These cases assist the arguments of the appellant. 6.4 Thus, following t....
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....e of the goods had passed on from seller to buyer only at the place of destination, which is the address of the buyer. As such, the buyer had no right over the goods till delivered to it. The Tribunal has not considered this aspect and has only relied on the amendment made to the definition of "input service" with effect from 1-42008 and rejected the claim of the appellant-assessee after that date. No further reason has been given by the Tribunal nor any finding has been recorded with regard to place of completion of sale of the goods. 12. Since we are of the opinion that the sale had concluded only after the delivery of the goods was made at the address of the buyer, in the facts of the present case the appellant-assessee would be entitled to the benefit of Cenvat credit on Service Tax paid on outward transportation of goods by the assessee even after 1-4-2008. The appellant-assessee would thus be entitled to such benefit for the period 1-4-2008 to 31-7-2008 which has been denied to it by the authorities below. 13. For the forgoing reasons, this appeal stands allowed. The question of law is answered in favour of the assessee and against the Revenue. The order of the Tribunal t....